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Investing.com -- Rocket Companies, Inc. (NYSE:RKT) shares jumped 4.1% after the Detroit-based fintech platform reported second-quarter earnings that exceeded analyst expectations and provided strong forward guidance.
The mortgage and real estate company posted adjusted earnings per share of $0.04, beating analyst estimates of $0.03, while revenue reached $1.36 billion, surpassing the consensus forecast of $1.28 billion. The company’s adjusted revenue of $1.34 billion came in above the high end of its guidance range. For the third quarter, Rocket Companies projected revenue between $1.6 billion and $1.75 billion, well above analyst expectations of $1.44 billion.
Rocket Mortgage generated $29.1 billion in closed loan origination volume during the quarter, representing an 18% increase YoY, while net rate lock volume grew 13% YoY to $28.4 billion. However, gain on sale margin decreased to 2.80%, down 19 basis points from the same period last year.
"Rocket delivered a standout second quarter, exceeding the high end of guidance with $1.34 billion in adjusted revenue and delivering adjusted diluted EPS of $0.04," said Varun Krishna, CEO and Director of Rocket Companies. "Successfully closing the Redfin (NASDAQ:RDFN) transaction marks a proud milestone in our legacy."
The company completed its all-stock acquisition of Redfin Corporation on July 1, a strategic move that brings one of the most recognized real estate brands in the U.S. under Rocket’s umbrella. The acquisition increases Rocket’s Class A float to 12% and adds Redfin’s platform, which draws 50 million monthly active visitors.
Rocket Companies maintained a strong liquidity position with $9.1 billion in total liquidity as of June 30, including $5.1 billion in cash on the balance sheet. The company’s servicing portfolio unpaid principal balance was $609 billion, representing approximately 2.8 million loans serviced, which generates about $1.6 billion in recurring servicing fee income annually.
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